anyone go to university of phoenix?

aspiringsoul

With big for-profit colleges getting 80 to 90 percent of their revenues from federal aid, their sector is not a free market effort; it’s a government program. And the question facing the administration was (and is): Should this program have rules that permit rampant waste, fraud and abuse, or should it have rules that motivate colleges to compete by actually helping students train for careers?

^^^^^


This is my point.....

NetworkNewb

eSenpai wrote: »

I submit that these coaches have far less influence on the EDUCATION of the entire student body at their respective institutions than do the highly compensated executives that you speak of.

There is a reason good college coaches get compensated very well. Pretty sure they have a decent impact on the entire student body's education with the money they bring in.

Here is a snapshot I found from 2008, assuming they are higher now: College Athletics Revenues and Expenses - ESPN

SaSkiller

Lol, I can't keep up with everything in the thread but aspiringsoul, I'll tell you my issue with admission standards. A. They may be unrelated to what is being taught. A student going into a certificate program doesn't need to be at the same level as a CS student coming into the uni. If my program doesn't require math skills beyond knowing how to add and subtract, I don't need to take a test to meet standard admission, and when I score low in math they want me to pay for an extra class unrelated to my certificate that will ultimately be useless to me.

Secondly, coming from your example again, admission standards "scores on tests" have no correlation that I can see with someone's dedication. We have seen numerous people at FP and NP educational institutions give their all to finish their programs. My SAT score (if I had one) says nothing about my capability to complete a program.

Thats just my .02 though.

aspiringsoul

SaSkiller wrote: »

Lol, I can't keep up with everything in the thread but aspiringsoul, I'll tell you my issue with admission standards. A. They may be unrelated to what is being taught. A student going into a certificate program doesn't need to be at the same level as a CS student coming into the uni. If my program doesn't require math skills beyond knowing how to add and subtract, I don't need to take a test to meet standard admission, and when I score low in math they want me to pay for an extra class unrelated to my certificate that will ultimately be useless to me.


Secondly, coming from your example again, admission standards "scores on tests" have no correlation that I can see with someone's dedication. We have seen numerous people at FP and NP educational institutions give their all to finish their programs. My SAT score (if I had one) says nothing about my capability to complete a program.

Thats just my .02 though.

SaSkiller,

I understand your point and I agree with you to an extent. However, I think that there needs to be some kind of admissions process in place that ensures that the student is adequately prepared for the program that he or she is enrolling into.

Admissions representatives at Non-Profits typically do not have any monetary incentive to enroll a student into a program at their school.

Recruiters at For-Profit colleges DO have a monetary incentive to enroll as many students as they possibly can without any regard to that student's ability to complete the program, or even if the credential they are conferred will meet the promises that the recruiters and the college make that student.

My arguments against the For-Profit school industry are detailed in my previous posts. The University of Phoenix basically have call centers that attempt to recruit prospective students (some of the other for-profit schools do as well too).

The University of Phoenix has a vast and sophisticated marketing and recruiting operation. In 2011 the Phoenix parent company, Apollo Group, spent more than $1 billion on recruiting and marketing -- about 23 percent of the company's revenue.
The company will not say how many recruiters it employs, but Harkin's committee found that the 30 for-profit companies it investigated employed, on average, one recruiter for every 48 students.
The University of Phoenix does not have any employees it calls "recruiters." They are called enrollment advisers. Some of those enrollment advisers are based at University of Phoenix locations around the country, where they often meet with prospective students face to face. But many of the advisers are located in Phoenix, where they work in big rooms that look and sound like call centers.
A University of Phoenix enrollment adviser talks on the phone with a prospective student at the company headquarters in Phoenix. (Photo: Emily Hanford)

At the company's headquarters, a collection of modest office buildings near the Phoenix airport, about 700 advisers work in two buildings -- and that's just to service online students in the central United States. Some of the advisers focus specifically on enrollment. Other advisers specialize in financial aid or academics. Every student who enrolls at Phoenix now gets one of each kind of adviser; the company calls this a "graduation team."
The advisers sit at cubicles decorated with pictures of their families as well as University of Phoenix pins and bumper stickers and, in some cases, grateful letters from students they have worked with. Advisers spend most of their day on the phone. They help prospective students figure out what degree they want, fill out financial aid forms, and gather the paperwork needed for a transcript review of previous college credits.
The University of Phoenix says these advisers make the complex process of signing up for college and applying for financial aid simpler and more user friendly.
But Bob Shireman, former deputy undersecretary of education in the Barack Obama administration, says Phoenix and other for-profit colleges make college too easy to buy.
"They get the train moving down the track, and the next thing you know you're signed up for the program," says Shireman. "You've taken out a federal loan, and it's happened, sort of like buying something at the checkout stand at the store. You didn't totally plan it, but you kind of had a little bit of interest and next thing you know, you're a student."
Shireman is particularly concerned about low-income and first-generation college students, who may not know much about how college works and may not understand that even if all of their tuition is covered by federal aid, they will have to pay back the money that comes from loans -- whether they finish their degree or not.
Virtually all (96 percent) of the students who go to for-profit schools borrow money. By comparison, 13 percent of students at community colleges, 48 percent at four-year public schools and 57 percent at four-year private nonprofit colleges borrow to pay tuition.
There are several reasons for this. Tuition is typically higher at for-profits than at public schools -- in part because when a student goes to a public school, state taxpayers are footing some of the bill, lowering the tuition price. Private nonprofit colleges often reduce the sticker price for students through scholarships and other kinds of institutional aid. And students who go to for-profit schools are more likely to be low-income than students at other kinds of colleges. They have to borrow to pay tuition.
Bob Shireman is concerned that students who go to for-profit schools don't realize they might be able to go to public colleges, where they'd typically pay less. He says the extensive marketing by for-profits -- slick TV ads and abundant Internet pop-ups -- overwhelms the marketplace and crowds out public schools that don't, or can't, spend millions of dollars a year on marketing.
Shireman and other critics of for-profits are also concerned that some schools use aggressive or misleading tactics to get students to sign up. There is evidence that some schools, including Phoenix, did this, at least in the past.
A 2007 University of Phoenix training manual obtained by the Senate HELP committee instructed recruiters to push prospective students to enroll by creating a sense of urgency. You have "to challenge [students] to act NOW," the manual said.
Another training document stated: "Do not tell the student we have classes running every week unless you can agree on a start date." To create urgency, recruiters were instructed to avoid telling prospective students, "[Y]ou have plenty of time to get everything in order," because "if the student thinks he/she has plenty of time, he/she might wait and apply later."
The University of Phoenix Online Central Campus in Phoenix, Ariz., where advisers talk on the phone with prospective students and help them enroll. (Photo: Emily Hanford)

The company told the HELP committee that the training manual is no longer in use. (Read the University of Phoenix/Apollo Group responseto the HELP committee investigation.)
According to the committee'sfinal report, "[M]any companies used tactics that misled prospective students with regard to the cost of the program, the availability and obligations of financial aid, the time to complete the program, the completion rates of other students, the job placement rate of other students, the transferability of the credit, or the reputation and accreditation of the school."
Another concern is how enrollment advisers were managed and paid. The HELP committee found that in order to achieve company enrollment goals, recruiting managers at some companies "created a boiler-room atmosphere, in which hitting an enrollment quota was recruiters' highest priority. Recruiters who failed to bring in enough students were put through disciplinary processes and sometimes terminated."
Some companies paid recruiters based on how many students they enrolled. This kind of "incentive compensation" has a long and somewhat complicated history.
Back in 1992, in response to evidence that recruiters at some for-profit colleges were being paid based on how many students they enrolled, Congress passed a series of reforms that banned incentive compensation for college recruiters and personnel.
A decade later, in response to lobbying by the growing for-profit college industry, the Department of Education under President George W. Bush added a series of "safe harbors" that allowed some forms of incentive pay. Two former employees of the University of Phoenix filed a whistleblower lawsuit in 2003 that alleged that Apollo, the Phoenix parent company, violated those rules. Apollo paid the government $67.5 million to settle the lawsuit in 2009, plus $11 million in lawyers' fees. The company admitted no wrongdoing in the case.
The Department of Education under President Barack Obama eliminated the "safe harbors" that made some forms of incentive compensation legal. University of Phoenix officials say the rules regarding what counts as incentive compensation were and continue to be unclear. In response, the company says it eliminated "enrollment results as a component of compensation for our admissions personnel" effective September 1, 2010.
The company was sued again in May 2011 by two other whistleblowers who allege the University of Phoenix continued to pay advisers based on the number of students they enrolled. That lawsuit is ongoing.
Student Jeff Holmes says enrollment advisers misled him about how long earning a degree would take and how much it would cost. He sees the University of Phoenix as "kind of like a car dealership."
"They want to get you in the door," he says. And like a car dealer, they "want you to have success with the car. They want it to go well for you. But if it doesn't, they've already been paid."
Holmes is four years into a master's degree and more than $60,000 in debt. Most of that debt is in the form of federal student loans. The University of Phoenix already has the money; it's the federal government Holmes is paying now.

One of Harkin's biggest problems with for-profit colleges is the amount of money they get from the federal government.
In 2009, the 15 publicly traded for-profit education companies in the United States received 86 percent of their revenues from taxpayers, according to the HELP committee. The committee estimates the University of Phoenix parent company got 88.7 percent of its revenue from federal education funds.

The school that collects more Pell Grant dollars than any other is the University of Phoenix; it collected more than $1 billion from the Pell Grant program in 2010.

Most of this money is from federal student loans, and from federal grants for low-income students, known as Pell Grants. In 2009-10, for-profit colleges received $32 billion from these programs, 25 percent of the total spent at all colleges and universities in the United States -- even though only about 10 percent of all college students went to for-profit schools.
The school that collects more Pell Grant dollars than any other is the University of Phoenix; it collected more than $1 billion from the Pell Grant program in 2010.
The other major source of federal spending at for-profit schools is programs designed to help members of the military and veterans. Fifty percent of Department of Defense tuition assistance benefits go to students at for-profit colleges, as do 37 percent of the benefits that come from the Post-9/11 GI Bill. The University of Phoenix gets about 86 percent of its revenue from federal financial aid programs and about 3 percent from Department of Defense and Post-9/11 GI Bill funds.
Harkin and a number of other critics of for-profit schools charge that the schools specifically target low-income and military students because federal aid programs can cover their tuition.
But for-profit schools take issue with this charge. They contend they are offering high-quality education to people who might not otherwise have access to it. They say the increase in the proportion of their revenue that comes from the federal government is due to the fact that the government has expanded federal student aid programs in recent years. And they point out that the vast majority of the federal money they get comes from loan programs, not grants.
Mark Brenner, senior vice president of external affairs for the University of Phoenix parent company, Apollo Group, says a loan should not be characterized as government money because it's the student who ultimately pays the bill. Loans are "not federal dollars," Brenner says, because "it's the student's obligation, not the government's or the taxpayers' obligation" to pay the money back.
But a lot of students at for-profits default on their loans.
[h=3]Default and Dropout Rates[/h]Student loan default rates have become a big political issue in recent years.
More than one in five students who enroll at a for-profit school end up defaulting within three years of starting to repay their loans. Students who attended for-profit colleges account for close to half of all federal student loan defaults. Some of the students in default have their degrees -- but many of them don't. A study by Education Sector, an independent education policy think tank in Washington, D.C., shows that borrowers who drop out are more than four times more likely to default on their loans than those who graduate. Dropout rates at for-profit colleges tend to be high.
The for-profit sector has "the dubious distinction of having the highest debt levels, the highest default rates, and some of the lowest completion rates," says Pauline Abernathy, vice president of the Institute for College Access and Success, an advocacy organization that's been one of the chief critics of for-profits. Abernathy told the Senate HELP committeethat students at for-profits who finish their degrees are more likely to be in default than students who dropped out of public and nonprofit colleges.
It's tricky to compare dropout rates among different kinds of colleges because the U.S. Department of Education only counts students who are first-time, full-time students. The majority of students at many for-profit colleges are not first-time, full-time students. The industry argues that the official data does not provide an accurate picture of what is happening with students at for-profits.
This is one reason the Senate HELP Committee did its own analysis of dropout rates at for-profit schools. The committee gathered enrollment and withdrawal data from each school and calculated that, of the students who enrolled in 2008-2009, 54 percent had left without a degree by the middle of 2010. The withdrawal rate from the University of Phoenix was 60.5 percent, higher than the industry average. Most of the students who quit Phoenix were in associate's degree programs. In fact, if you look at just students in bachelor's degree programs, students at the University of Phoenix were less likely to withdraw in the period examined than students in bachelor's degree programs at most other for-profits.
It may be shocking to learn that 54 percent of students who enrolled at for-profits quit within a year and a half (and more students likely withdrew in the subsequent months and years, without finishing their degrees). But consider this: The official Department of Education data shows that 44 percent of students at public universities do not complete their degrees within six years. At community colleges, 80 percent of first-time, full-time students don't finish their degrees on time. The official data shows that students pursuing certificates or associate's degrees at for-profit schools are actually more likely to graduate than students at nonprofit schools, whether public or private.
University of Phoenix officials say they are working to raise graduation rates.
In November 2010, the company began requiring entering students who do not have at least 24 college credits to take a free, three-week orientation class before starting a degree program. The idea is to make sure students know what they're getting into before they begin. The company's goal is to weed out people who are less likely to succeed. Twenty percent of students who go through the orientation class choose not to enroll.

U.S. Sen. Tom Harkin has praised Kaplan and the University of Phoenix for these new programs. But he thinks more needs to be done, industry-wide, to improve graduation rates, lower defaults and decrease the amount students at for-profits borrow.Kaplan University, another for-profit school, has instituted a similar effort to try to reduce dropouts and make sure entering students know what kind of time and effort it will take to get a degree. Entering students can start a degree program right away, but they can withdraw within the first five weeks without any financial obligation beyond an application fee.
He believes the government has a crucial role to play. "Congress has failed to counterbalance investor demands for increased financial returns with requirements that hold companies accountable to taxpayers," writes the HELP Committee in the final report of its two-year for-profit college investigation. "Federal law and regulations currently do not align the incentives of for-profit colleges so that the colleges succeed financially when students succeed." Harkin says the opposite is the case -- that companies have been able to make a lot of money by enrolling millions of students who ended up dropping out.
Harkin is calling for a number of changes to current law and the administration of federal financial aid programs. Among the changes he would like to see:

• Tie colleges and universities' access to federal financial aid to "minimum student outcome thresholds." Those thresholds have not been clearly defined. (The Department of Education did put in place new regulations, effective July 1, 2012, that require for-profit schools to show they are successfully preparing students for "gainful employment.")
• Prohibit colleges from using federal money for marketing, advertising or recruiting.
• Require that for-profit colleges receive at least 15 percent of their revenue from sources other than federal funds. (Current law requires that for-profits get no more than 90 percent of revenue from federal financial aid programs, but that does not include military or veteran student assistance programs. Critics say this is one reason for-profits recruit veterans and students in the military; by enrolling them, for-profits can increase the amount of revenue that doesn't count on the "90" side of the so-called "90-10" rule.)

The for-profit industry is fighting these proposals and has found widespread support among Republicans on Capitol Hill. Harkin, a Democrat, is not hopeful he can get anything significant passed in the current session of Congress. But he says for-profit schools must be better regulated.
"This is an industry that is ripe for, begging for, regulation," says Harkin.
In the Capitol Hill press conference where he released his committee's final report, Harkin included the University of Phoenix in a group of for-profits that he says have had "very serious shortcomings in the past but are beginning to make some changes and are open to new thinking about how to improve student outcomes."
But he added this: "The bottom line is that a large share of the $32 billion that taxpayers invested in [for-profit] schools in 2010 was squandered. And this cannot be allowed to continue."
Harkin remains fundamentally skeptical about whether big corporations whose primary mission is to make money can be trusted to do the right things for students. About the University of Phoenix, Harkin says: "It needs to be less of a money-making machine for Wall Street and more of an educational institution for students and taxpayers."
The Case Against For-Profit Colleges and Universities

eSenpai

NetworkNewb wrote: »

There is a reason good college coaches get compensated very well. Pretty sure they have a decent impact on the entire student body's education with the money they bring in.

Here is a snapshot I found from 2008, assuming they are higher now: College Athletics Revenues and Expenses - ESPN

OK, this is indeed my final note on this thread.
I ask that you take a good look at your own link, or others, for the dollars spent on the athletics programs, facilities and things non-educational for any program out there. It's all available to see exactly how many of those football/basketball dollars are going back into education. No school in the SEC should be hurting for education funding based on their football dollars alone yet magically most have their hands out and have cut back on dollars or professors while increasing tuition and fees. Indeed almost every non-profit with a big sports following has increased tuition, decreased professors and increased class sizes. Far too many people are playing fast and loose along with smoke and mirrors with all the money that football generates in non-profits while the media screams the for-profits are the actual problem. I submit they all have issues so one must pick their poison vs slurping at the cult of "if it says non-profit then it MUST be in my best interests."

In fact, the link you provided shows that most big football schools spent more on coaches salaries than they did on tuition for the players(How many players on a football team again? How many coaches? ). That's right. That number under tuition is JUST for the players...not the other 95% of the student body. By your own information, they are spending more money on the coaching staff than they are on education for their players...care to guess what percentage of this multi-billion dollar machine goes back into education?? Look further and see if you can tell how much of the remaining money goes back to the student body.

http://www.nytimes.com/2014/12/31/sports/ncaafootball/what-made-college-ball-more-like-the-pros-73-billion-for-a-start.html
SEC Schools Spend $163,931 Per Athlete, And Other Ways The NCAA Is A Bonfire For Your Money
NCAA | Finances | USA TODAY Sports (Be sure to click the methodology link at the bottom.)

While aspiringsoul is adamant on his stance against for-profits, even he can't say all non-profits are doing the right thing when the evidence so clearly says they are not. He/she keeps picking on a few for-profit schools yet there are for more non-profit schools with issues than for-profit schools. If we just isolate it by sports then given all the money that pours into football, there should not have been a single tuition increase in years for any of these big program non-profit schools yet mysteriously they get one almost every year. SEC football alone is a half-billion to a billion dollar machine. Add in the other conferences and college football is making someone money hand over fist. Where o'where does it all go? Not to education. Not to the players. Hmmm....where could it be...

All I have asked is that if one is going to beat the drum of "for-profits are bad!" then one should have at least first checked to make sure their own house was in order because all schools have problems. Pick the set of issues that you can live with for your circumstances based on one's own research. A "for profit" did just fine by me due to my life circumstances. Indeed most of us on this board, have for-profits to thank for pushing the distance learning paradigm to the point that brick and mortar schools had to get on board.



PS: Hopefully, I did not come across "some kind of way". I just enjoy a good debate. Cheers!

TeKniques

I would shy away from UoP just from sheer cost. Which brings up a good point ... for-profit vs. non-profit is laughable. Anyone truly believe that state universities are not in it for the money?

Regarding college athletics and coaches salaries - that's skewed because the only thing people want to talk about are the sports that generate revenue (football and basketball). Just about EVERY other sport at a major university loses money every year and costs a lot which ends up in a net loss overall for colleges that offer athletics. In my opinion coaches are compensated well to create programs that are exceptional in what can be used as great marketing for the university to attract students ... oh, could it be for the tuition?

aspiringsoul

eSenpai wrote: »

OK, this is indeed my final note on this thread.
I ask that you take a good look at your own link, or others, for the dollars spent on the athletics programs, facilities and things non-educational for any program out there. It's all available to see exactly how many of those football/basketball dollars are going back into education. No school in the SEC should be hurting for education funding based on their football dollars alone yet magically most have their hands out and have cut back on dollars or professors while increasing tuition and fees. Indeed almost every non-profit with a big sports following has increased tuition, decreased professors and increased class sizes. Far too many people are playing fast and loose along with smoke and mirrors with all the money that football generates in non-profits while the media screams the for-profits are the actual problem. I submit they all have issues so one must pick their poison vs slurping at the cult of "if it says non-profit then it MUST be in my best interests."

In fact, the link you provided shows that most big football schools spent more on coaches salaries than they did on tuition for the players(How many players on a football team again? How many coaches? ). That's right. That number under tuition is JUST for the players...not the other 95% of the student body. By your own information, they are spending more money on the coaching staff than they are on education for their players...care to guess what percentage of this multi-billion dollar machine goes back into education?? Look further and see if you can tell how much of the remaining money goes back to the student body.

http://www.nytimes.com/2014/12/31/sports/ncaafootball/what-made-college-ball-more-like-the-pros-73-billion-for-a-start.html
SEC Schools Spend $163,931 Per Athlete, And Other Ways The NCAA Is A Bonfire For Your Money
NCAA | Finances | USA TODAY Sports (Be sure to click the methodology link at the bottom.)

While aspiringsoul is adamant on his stance against for-profits, even he can't say all non-profits are doing the right thing when the evidence so clearly says they are not. He/she keeps picking on a few for-profit schools yet there are for more non-profit schools with issues than for-profit schools. If we just isolate it by sports then given all the money that pours into football, there should not have been a single tuition increase in years for any of these big program non-profit schools yet mysteriously they get one almost every year. SEC football alone is a half-billion to a billion dollar machine. Add in the other conferences and college football is making someone money hand over fist. Where o'where does it all go? Not to education. Not to the players. Hmmm....where could it be...

All I have asked is that if one is going to beat the drum of "for-profits are bad!" then one should have at least first checked to make sure their own house was in order because all schools have problems. Pick the set of issues that you can live with for your circumstances based on one's own research. A "for profit" did just fine by me due to my life circumstances. Indeed most of us on this board, have for-profits to thank for pushing the distance learning paradigm to the point that brick and mortar schools had to get on board.



PS: Hopefully, I did not come across "some kind of way". I just enjoy a good debate. Cheers!

The reason that I am posting on this forum is not so I can "win" a debate. The reason that I am posting on this topic is because I want for every student who considers a For-Profit school to know "ALL of the Facts" about that school before the Recruiter convinces the student to sign the dotted line. I did not earn my Bachelor degree from a Regionally accredited institution until I was 27 years old because I had to start all over again after attending ITT Tech for an Associate degree. I have seen students of For-Profit schools who are not only completely dissatisfied with their experience, but they feel taken advantage of, and they are unable to pay on their student loans due to their inability to find gainful employment in their field of study, which leads them to default, which ruins them financially and sticks the American taxpayer with the bill. Many Non-Profits are run like businesses too...but there is MUCH MORE DOCUMENTED ABUSE AND DECEPTION in the For-Profit sector. Don't take my word for it, read the resources that I have provided!

In regard to the college sports industry, I too think that the salaries of the coaches are ridiculous. I also think it's ludicrous that the students are not PAID for their performances due to the opportunity cost of not being able to work while they are training and on the road. John Oliver has an interesting video that you can watch about that here:

https://www.youtube.com/watch?v=pX8BXH3SJn0

This topic is not a debate for me. You're right when you say that I am adamant on my stance against the For-Profits. That is because of the deceptive and fraudulent actions of many of the colleges in the industry (that are well documented by the way). How many Non-Profits have signed up their students for incredibly high interest private loans that they expected 64% of students to default on? How many Non-Profits have misled their students to believe that the credential they were conferred by the institution would lead them to gainful employment, when instead, it is worthless and leads them to financial ruin.

While I do agree that some of the For-Profits have paved the way for modern distance education, I don't think that they are a good choice for many students today due to their low spending on instruction (and astronomical cost compared to non-profits).

I think that these colleges should be required to disclose their Graduation/Default/ Gainful Employment rates to their students before they enroll.

How many of you would enroll at these For-Profit colleges after reading the PDFs that I attached? How many of you would consider ITT Tech if the school were required to disclose the CFPB and SEC lawsuits to you?

I encourage everyone to do your research before you enroll at any school, but you should be very cautious when considering a For-Profit school.

I have a lot of documentation to back up my stance on the For-Profits, for anyone who is considering one of the schools, I implore you to consider other options first. However, if you decide that a For-Profit is the best fit for you, then good luck to you.

The federal Consumer Financial Protection Bureau this morning filed a civil lawsuit against for-profit college company ITT Educational Services, seeking restitution to students allegedly harmed by ITT's private loan programs, a civil fine, and an injunction against the company. The CFPB filed its complaint in federal court in Indianapolis, near ITT's headquarters.
UPDATE [1:15 pm]: The CFPB just held a press conference to discuss the case. CFPB director Richard Cordray charged that ITT "misled students by overstating their salaries and job prospects upon graduation" and then pushed them into predatory high-interest private student loans.
Cordray called the abuse of students by the overall for-profit college industry "truly an American tragedy." He was joined at the event by the attorneys general of Kentucky, Illinois, Iowa, and New Mexico, all of whom are conducting investigations of major for-profit colleges.
Illinois AG Lisa Madigan called for-profit college business practices "indefensible." Kentucky AG Jack Conway discussed the new investigation that thirteen state AGs have launched against Education Management Corporation, Career Education Corporation, and Corinthian Colleges, as well as ITT. He said many for-profit colleges were "more interested in getting student loan dollars than in educating students."
Conway noted that the for-profit college industry hires large numbers of powerful lobbyists, including former members of Congress, to block accountability measures, and said that these law enforcement investigations were an important response to the harms caused by the industry.
Cordray said that ITT has been telling different stories to students than what it is telling investors. ITT's own analysis, he said, showed that 64 percent of its students would default on their private loans, information it did not share with students. "While many students got poorer, the investors and shareholders got richer," he said.
Here's the press release CFPB sent out:
FEBRUARY 26, 2014
CFPB Sues For-Profit College Chain ITT For Predatory Lending
ITT Pushed Consumers into High-Cost Student Loans Likely to Fail
WASHINGTON, D.C. -- Today the Consumer Financial Protection Bureau (CFPB) filed a lawsuit against ITT Educational Services, Inc., accusing the for-profit college chain of predatory student lending. The CFPB alleges that ITT exploited its students and pushed them into high-cost private student loans that were very likely to end in default. The CFPB is seeking restitution for victims, a civil fine, and an injunction against the company.
"ITT marketed itself as improving consumers' lives but it was really just improving its bottom line," said CFPB Director Richard Corday. "We believe ITT used high-pressure tactics to push many consumers into expensive loans destined to default. Today's action should serve as a warning to the for-profit college industry that we will be vigilant about protecting students against predatory lending tactics."
Like the mortgage market in the lead-up to the financial crisis, the for-profit college industry may be experiencing misaligned incentives. These colleges benefit when students take out large amounts of loans, regardless of the students' long-term success. The CFPB is concerned that some of these corporations may be employing practices to coax consumers into taking out more federal and private student loans. Today's announcement is the Bureau's first public enforcement action against a company in the for-profit college industry.
ITT Educational Services, Inc. is an Indiana-based for-profit provider of post-secondary technical education. Tens of thousands of students are enrolled online or at one of ITT's roughly 150 institutions in nearly 40 states. ITT's tuition costs are among the highest in the country in the for-profit industry. Earning an Associate's degree at ITT can cost more than $44,000. Bachelor's degree programs can cost $88,000. That is significantly higher than the cost of similar degrees at a community college or a public four-year institution.
Most of ITT's students borrow large sums to pay the high tuition costs and the majority of this money is borrowed from federal student loan programs. But private student loans also provide critical revenue for ITT. Because most ITT students' federal aid does not cover the full cost of an ITT program, most students face a "tuition gap" requiring them to find other sources of funding.
The CFPB's lawsuit alleges that ITT encouraged new students to enroll at ITT by providing them funding for this tuition gap with a zero-interest loan called "Temporary Credit." This loan typically had to be paid in full at the end of the student's first academic year. But ITT knew from the outset that many students would not be able to repay their Temporary Credit balances or fund their next year's tuition gap.
The CFPB lawsuit alleges that between July 2011 and December 2011, ITT pushed its students into repaying their Temporary Credit and funding their second-year tuition gaps through high-cost private student loan programs. Students were left in the dark about the fact that taking out these high-cost loans would be required to continue their studies. However, ITT's CEO revealed in investor calls that converting the temporary loans to long-term loans was the company's "plan all along."
Under the Dodd-Frank Wall Street Reform and Consumer Protection Act, the CFPB has the authority to take action against institutions engaging in unfair, deceptive, or abusive practices. Specifically, in today's lawsuit, the Bureau alleges the following conduct by ITT:

• Pressured into predatory loans: ITT used its financial aid staff to rush students through an automated application process without affording them a fair opportunity to understand the loan obligations involved. In some cases, students did not even know they had a private student loan until they started getting collection calls. The loans were high-cost. For borrowers with credit scores under 600, for example, the costs of the private student loans included 10 percent origination fees and interest rates as high as 16.25 percent.
• Credits not transferable: ITT was accredited by a national organization that accredits many for-profit schools, but the credits that students earned typically did not transfer to local community colleges or other nonprofit schools such as public or private colleges. ITT used the prospect of expulsion and the loss of the money already spent during the student's first year to coerce students into taking out the private loans.
• Misleading future job prospects: The Bureau believes that ITT's representations led students to think that when they graduated they were likely to land good jobs and enough salary to repay their private student loans. In this way, ITT exploited student expectations while it knew that a majority of students would default.
• Loans likely to fail: ITT knew that most of its students would ultimately default on their private student loans; it projected a default rate for its students of 64 percent. Defaulting on private student loans can have grave consequences for consumers. It can make it difficult to get any kind of loan for years and even affect a borrower's job prospects. And, because private student loans are difficult to discharge in bankruptcy, the debt can be very difficult to recover from.

BREAKING: Federal Consumer Agency Sues For-Profit College ITT Tech | David HalperinSource:

aspiringsoul

For-Profit Colleges Only a Con Man Could Love | Village Voice

Obama Must Not Coddle For-Profit Colleges Facing Fraud Probes*|*David Halperin

Corinthian Colleges Employee: “We Work For The Biggest Scam Company In The World”

The Perfect Lobby: How One Industry Captured Washington, DC | The Nation

For-profit colleges get harsh grades - Business - The Boston Globe

For-profit College Group APSCU Has Consistently Harbored Fraudulent Schools*|*David Halperin


Employers Shy Away From Online, For-Profit Graduates - US News

Subprime Students: How For-Profit Universities Make a Killing By Exploiting College Dreams | Mother Jones

Screw U: How For-Profit Colleges Rip You Off | Mother Jones

List of for-profit universities and colleges - Wikipedia, the free encyclopedia

http://www.phillytrib.com/commentary/article_4b17db6f-ec9e-53e7-824c-68435f4f16ba.html

The Law-School Scam - The Atlantic

As For-Profit Colleges Fight for Their Right to Abuse Students, It's Obama's Time to Decide*|*David Halperin

Obama Administration Backs Down On Tough Rules Targeting For-Profit Colleges

For-profit colleges still reap millions from GI Bill - Fortune

Veterans Are Most Vulnerable To For-Profit College Manipulation - Forbes

More Scam Websites to Lure the Poor to For-Profit Colleges*|*David Halperin

Why students suffer at for-profit schools, and how to protect them | MSNBC

http://www.nytimes.com/2014/06/08/books/review/degrees-of-inequality-by-suzanne-mettler.html?_r=2

For-Profit College Marketer Thrived By Posting Fake Ads To Popular Job Sites*|*David Halperin

– Lenders may lead students to ‘debt, despair’

The Downfall of For-Profit Colleges - The Atlantic

I care about the outcomes of any students considering these schools. Please do your research, and think carefully before you decide to attend ANY school (especially a For-Profit due to the low graduation rate, high default rate, and poor outcomes that many of the students have faced).